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BabaBlast [244]
2 years ago
6

If the MPC is 0.80 and disposable income increases from 32,000 billion to $37,000 billion, then consumption will increase by: A.

$1,000 billion. B. $29,600 billion. C. $5,000 billion. D. $4,000 billion.
Business
1 answer:
horsena [70]2 years ago
8 0

If the MPC is 0.80 and disposable income increases from 32,000 billion to $37,000 billion, then consumption will increase by: B. $29,600 billion.

<h3>Increase in consumption</h3>

Using this formula=Increase in disposable income×MPC

Where:

Increase in disposable income=$37,000

MPC=0.80

Let plug in the formula

Increase in disposable income=$37,000 billion×0.80

Increase in disposable income=$37,000 billion×0.80

Increase in disposable income=$29,600 billion

Therefore consumption will increase by:  B. $29,600 billion.

Learn more about increase in consumption here:brainly.com/question/6955443

<h3 />
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